Reliance Jio’s Increased Tariff Plans Are Still Cheaper Than Peers’

After Bharti Airtel Ltd. and Vodafone Idea Ltd., now Reliance Jio Infocomm Ltd. hiked prices of its prepaid plans. Yet, that’s at least 13% cheaper than peers.

These prices, effective Dec. 1, 2021, are cheaper than the comparable plans of Bharti Airtel and Vi.

• The 28-day plan of Reliance Jio is at a 13.4% discount.

• The entry-level 84-day plan is 13.2% and 13.9% cheaper.

• The starting high-end plan is 13.3% less, though this is not directly comparable as it offers a validity of 336 days compared to Bharti Airtel and Vi’s 365-day validity.

Motilal Oswal, in its Nov. 22 report, had estimated that a similar price hike would “increase Reliance Jio’s Ebitda by 23%”.

UBS sees a gradual increase in sector ARPUs of 10% annually over FY22-24E, driven by a combination of secular trends such as 2G to 4G / prepaid to postpaid migration, as well as gradual tariff increases. It estimates that if all operators increase tariffs, such ARPU expansion will be possible in a shorter time frame (next two-three quarters).

Reliance Jio’s average revenue per user—the amount an operator earns per subscriber per month—rose 3.7% sequentially to Rs 143.6 per month in the quarter ended September. ARPUs of peers Bharti Airtel and Vi, too, increased during the period.